Joint Bank Accounts Frozen if Mental Capacity Lost
It is common knowledge that a bank or building society (and many other financial institutions for that matter) will freeze an account if the holder becomes mentally incapable. What people may not realise is that it is now common practice for high street banks to freeze withdrawals from joint accounts if one of the account holders becomes mentally incapable.
This is in line with the guidance issued this year by the British Bankers Association. If the mentally incapable account holder has made a Property and Financial Affairs Lasting Power of Attorney (LPA) which has been registered with the Office of the Public Guardian, the joint account holder and their attorney (who may be one and the same person) can continue to operate the account. Alternatively, if the incapable account holder did not create a Property and Financial Affairs LPA the account will be frozen until an Order has been made by the Court of Protection appointing a Deputy to make decisions on behalf of the incapable person in respect of their property and affairs. Obtaining an Order from the Court of Protection is a costly and cumbersome procedure which can take up to 6 months before the Order is issued. So, if joint account holders want to avoid costly delays, they should take steps to make and register a Property and Financial Affairs LPA. By putting these in place you can choose who you want to manage your affairs when you are unable to do so for yourself and you can also put other important safeguards in place.
It is important that you take advice, we have the knowledge and experience to be able to advise you of the best way to achieve this.
Ken Beer MSWW
Published 21 October 2016